Lamb forecast positive

THE forecast for the Australian lamb industry remains positive for the second half of 2013, with improved seasonal conditions and continued strong demand in export markets assisted by a weaker Aussie dollar.
Ahead of releasing Meat & Livestock Australia’s mid-year sheep projections, chief economist Tim McRae gave his industry outlook.
“The outlook of lamb and sheepmeat producers remains positive thanks to good rain across southern Australia during winter, the significant decline in the Australian dollar and robust export demand,” Mr McRae said.
“Record export volumes due to the increased slaughter rates during the past year are likely to continue, due to the Australian dollar hovering around 90UScents and the forecast reduced supplies from New Zealand for 2013-14.
“The US, China and Middle East remain the key lamb export markets for Australia, accounting for 66 per cent of export volumes in 2013.”
Exports to the Middle East are forecast to increase by 10 per cent to reach 56,900 tonnes swt, while exports to China are forecast to increase 22 per cent to 36,000 tonnes swt. The US remains the highest value market with 38,100 tonnes swt.
“While the growth in export markets has been considerable throughout the past decade – with 51.5 per cent of lamb produced in 2013 exported, demand through the Australian domestic market remains strong and is still the largest single market for Australian lamb,” Mr McRae said.
The forecast for live sheep exports remains at two million head, down 12 per cent on 2012 due to the suspension of trade to Bahrain. Kuwait remains the key market for Australian live sheep and is expected to import a total of 820,000 head in 2013.
Mr McRae said the seasonal conditions into spring will be crucial in determining the timing and volume of lamb supplies into the first half of 2014.
However, the tough breeding season of 2012-13 is expected to reduce overall lamb supplies and put upward pressure on prices, with the main impact anticipated in early 2014.
– Jonathon Howard